Wednesday, 9 August 2017

What’s next? – USDJPY 09.08.17

Posted by Anonymous at 11:22 Labels:

USDJPY

The dollar/yen was down 0.40 percent as of 07:50 GMT on Tuesday to trade at 109.89, as geopolitical tensions impulsed demand for safe-haven yen.

Tensions in the Korean peninsula increased following comments from President Donald Trump assuring the US would respond to any threat with “fire and fury”.

In response to such remarks, Pyongyang said it is “carefully examining” a possible missile attack on Guam, an unincorporated territory of the United States in the western Pacific Ocean.

Ahead in the day, traders will be paying attention to US unit labor costs and nonfarm productivity for the second quarter, both due at 12:30 GMT, with a 0.7 percent and 1.2 percent build seen.

As we’ve already noted in many occasions, market focus is mainly directed to Thursday’s producer price index and Friday’sconsumer price index, which have the power to modify expectations for a third rate hike and provide guidance of Fed’s future plans for monetary policy.

From a technical perspective, the situation is even more supportive for traders buying the dips as the geopolitical tensions could easily vanish and inflation data send the dollar higher.

The US dollar index, which tracks the greenback against a basket of six major rivals, was trading at 93.42 by the time of this writing, easing 0.11 percent.

Japanese Tertiary industry activity index is expected on Thursday as of 04:30 GMT, with expectations for a 0.2 percent increase month-over-month.

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